Dear arka , Pon1965 is absolutely right.....
If any employee getting per month salary more then 6500 then he is exempted from pf deduction but if he wish to deducted pf from his salary then he can do so.So, Clear your doubt for the mention matter.
From India, Mumbai
2If any employee getting per month salary more then 6500 then he is exempted from pf deduction but if he wish to deducted pf from his salary then he can do so.So, Clear your doubt for the mention matter.
From India, Mumbai
Dear Ashok,
In any establishment where the number of employees are 20 or more the said establishment comes under the perview of EPF & MP Act 1952 and it is mandatory for the establishment to obtain a code from the local RPFC and remit PF under the said code.
As for salary employees getting a basic salary upto 6500 are covered employees and the employer must remit his PF as per statute provided the total number of employees in the establishment are 20 or more. Employee getting basic salary above 6500 are excluded employees and for them PF is not compulsory.
Since PF is a social security scheme in India almost all the employers pay PF to all employees irrespective of their salary bar.
Kalyan Mitra
From India, Calcutta
In any establishment where the number of employees are 20 or more the said establishment comes under the perview of EPF & MP Act 1952 and it is mandatory for the establishment to obtain a code from the local RPFC and remit PF under the said code.
As for salary employees getting a basic salary upto 6500 are covered employees and the employer must remit his PF as per statute provided the total number of employees in the establishment are 20 or more. Employee getting basic salary above 6500 are excluded employees and for them PF is not compulsory.
Since PF is a social security scheme in India almost all the employers pay PF to all employees irrespective of their salary bar.
Kalyan Mitra
From India, Calcutta
Hello,
Can someone please direct me to the act, section &/or sub section where it is mentioned that epf is voluntary if basic > 6500. I require this to show a copy to my HR dept, as they are not agreeing to my request of not deducting pf.. my basic is above 6500.. please assist...
thanks in advance..
From India, Mumbai
Can someone please direct me to the act, section &/or sub section where it is mentioned that epf is voluntary if basic > 6500. I require this to show a copy to my HR dept, as they are not agreeing to my request of not deducting pf.. my basic is above 6500.. please assist...
thanks in advance..
From India, Mumbai
Please find below an extract of an article by Sh. HL Kumar, Sr. Advocate and Editor, Labour Law Reporter. The entire issue of PF is well illustrated in the link:
COVERAGE OF A NEW EMPLOYEE UNDER
EMPLOYEESí PROVIDENT FUND SCHEME
If the wage/salary of a new employee is above Rs.6500 per month
and he has not been a member of Employees’ Provident Fund or
being member, has settled his account then he is not to be enrolled
as member of the Scheme. However, if the employer and the
employee both agree, there is no bar in enroling such an
employee as member under the Employees’ Provident Funds
Scheme, 1952. Para 34 of the Employees’ Provident Fund Scheme
provides for a declaration by a person before taking up
employment to state in writing whether or not he is a member of
the Fund and, if so, the relevant details thereof are to be given.
As such for every new appointee, an employer must obtain the
declaration in Form-2 prescribed for this purpose. Upon
enrolment it needs to be submitted as prescribed under Para 33
of Employees’ Provident Funds & Miscellaneous Provision
Scheme read along with Para 18 of the Employees’ Pension
Scheme. This Form also requires indicating the nominee and
family details. Besides that it is also advisable to get a declaration
in the format as given hereinafter containing declaration by the
newly appointed employee since a coverable employee is to be
enrolled as member of the Provident Fund Scheme from the
very first day of his joining and this provision has also been
upheld by the Bombay High Court.1
COVERAGE OF AN EMPLOYEE WHOSE SALARY
CROSSES RS.6500 PER MONTH
If the wage/salary of an employee working in a covered
establishment and covered under the Act, exceeds Rs.6500 per
month, then he will be entitled to remain covered upto Rs. 6500
per month. For instance, an employee who is a member and
whose salary was Rs.6400 per month, will continue to be a
member to the extent of Rs.6500 per month even when his salary
is increased to Rs.7000 per month. It the employer and employee
both agree, there is no bar in enrolling such or any other employee
as member under the Employees’ Provident Fund Scheme, 1952.
COVERAGE OF A RETIRED EMPLOYEE UNDER
THE SCHEME
There are two types of retired employees so far as Employees’
Provident Funds and Miscellaneous Provisions Act, 1952 is
concerned :
1. Those who retire from the establishments including public
sector undertakings which are covered under the
Employees’ Provident Funds and Miscellaneous Provisions
Act, 1952 and they were also members of the Fund and;
2. Those who retire after working in an establishment which
was not covered under the aforesaid Act and the Scheme
including in the Government service where Employees’
Provident Funds Act did not apply.
In the former case, the retired employee from a covered
establishment and having settled his Provident Funds account
from the Provident Fund Department or the Provident Fund Trust
(even on attaining of 55 years age) will not be legally eligible or
liable for Provident Fund membership on his employment or
re-employment in a covered establishment albeit when his wage/
salary is less then Rs.6500 per month. If either of the two
conditions are not fulfilled, the employee will be eligible and
liable to be covered from the first day of joining at least on
Rs.6500 per month even when he is drawing more salary.
The term “excluded employees” is a product of the Employees’
Provident Fund Scheme, 1952 as defined in clause (f) of para 2 as
under :
“An employee whose pay at the time he is otherwise entitled
to become a member of the Fund, exceeds six thousand and
five hundred rupees per month.
Explanation : ‘Pay’ includes basic wages with dearness
allowance, retaining allowance (if any) and cash value of food
concessions admissible thereon.”
“An excluded employee employed in or in connection with
the work of a factory or other establishment to which this Scheme
applies shall, on ceasing to be such an employee, be entitled
and required to become a member of the fund from the date he
ceased to be such employee.” [para 26(3) of EPF Scheme]
Persons who are retiring and settling their claim with the
Provident Funds authorities after attaining the age of 55 years
will be ‘excluded employees’. In this context, the word ‘Fund’ is
important. It signifies that only those persons who have settled
their claim with the Provident Fund established by the Employees’
Provident Fund Act/Scheme or any other Fund covered under
1. Kay Iron Works v. Union of India, 2007 LLR 175 (Bom. HC)
Coverage of Employees under Provident Fund Act
Articles Articles
that Act/Scheme will qualify for being termed as ‘excluded
employee’. To be more specific it is pertinent to note that anybody
retiring from an establishment of the Government or an
establishment not covered by the Employees’ Provident Funds
and Miscellaneous Provisions Act, 1952 will not qualify for
exclusion from membership in a covered establishment under
any circumstances whatsoever.
In this regard reference could be made to a judgment of the
Bombay High Court, where the Asstt. Provident Fund
Commissioner for Maharashtra and Goa called upon the
petitioner to remit the provident fund dues in respect of 11
employees who had already retired. Such employees were, in
fact, retired from service on attaining the age of 55 years. The
amounts due towards their provident fund were also received
by them. However, after retirement, these persons were allowed
to work as per their convenience subject to their health conditions.
The petitioner Company challenged the demand raised by the
provident fund authorities in a writ petition and referred to para
2(f) of the Employees’ Provident Funds Scheme defining ‘excluded
employee’ read with clause (a) of paragraph 69 of the Employees’
Provident Funds Scheme (supra). The High Court quashed the
demand as raised by the Provident Fund authorities.2
RETIRED EMPLOYEE IF COVERED ARE NOT
ELIGIBLE FOR EMPLOYEESí PENSION
SCHEME
In view of provisions contained in para 6A of the Employees’
Pension Scheme, 1995 restricting membership of the Pension
Scheme till attaining the age of 58 years or the fact that any
pensioner availing pensionery benefit under the Employees’
Pension Scheme, 1995, will not be required to be enrolled to the
membership of the pension fund (EPS, 1995) (though they will be
enrolled to the membership of the Employees’ Provident Fund
Scheme, 1952 as there is no age bar for the same) there will be no
requirement to divert their share of pension contribution to the
pension fund. Resultantly their entire EPF contribution will
remain credited in their provident fund account only.
From India, New Delhi
COVERAGE OF A NEW EMPLOYEE UNDER
EMPLOYEESí PROVIDENT FUND SCHEME
If the wage/salary of a new employee is above Rs.6500 per month
and he has not been a member of Employees’ Provident Fund or
being member, has settled his account then he is not to be enrolled
as member of the Scheme. However, if the employer and the
employee both agree, there is no bar in enroling such an
employee as member under the Employees’ Provident Funds
Scheme, 1952. Para 34 of the Employees’ Provident Fund Scheme
provides for a declaration by a person before taking up
employment to state in writing whether or not he is a member of
the Fund and, if so, the relevant details thereof are to be given.
As such for every new appointee, an employer must obtain the
declaration in Form-2 prescribed for this purpose. Upon
enrolment it needs to be submitted as prescribed under Para 33
of Employees’ Provident Funds & Miscellaneous Provision
Scheme read along with Para 18 of the Employees’ Pension
Scheme. This Form also requires indicating the nominee and
family details. Besides that it is also advisable to get a declaration
in the format as given hereinafter containing declaration by the
newly appointed employee since a coverable employee is to be
enrolled as member of the Provident Fund Scheme from the
very first day of his joining and this provision has also been
upheld by the Bombay High Court.1
COVERAGE OF AN EMPLOYEE WHOSE SALARY
CROSSES RS.6500 PER MONTH
If the wage/salary of an employee working in a covered
establishment and covered under the Act, exceeds Rs.6500 per
month, then he will be entitled to remain covered upto Rs. 6500
per month. For instance, an employee who is a member and
whose salary was Rs.6400 per month, will continue to be a
member to the extent of Rs.6500 per month even when his salary
is increased to Rs.7000 per month. It the employer and employee
both agree, there is no bar in enrolling such or any other employee
as member under the Employees’ Provident Fund Scheme, 1952.
COVERAGE OF A RETIRED EMPLOYEE UNDER
THE SCHEME
There are two types of retired employees so far as Employees’
Provident Funds and Miscellaneous Provisions Act, 1952 is
concerned :
1. Those who retire from the establishments including public
sector undertakings which are covered under the
Employees’ Provident Funds and Miscellaneous Provisions
Act, 1952 and they were also members of the Fund and;
2. Those who retire after working in an establishment which
was not covered under the aforesaid Act and the Scheme
including in the Government service where Employees’
Provident Funds Act did not apply.
In the former case, the retired employee from a covered
establishment and having settled his Provident Funds account
from the Provident Fund Department or the Provident Fund Trust
(even on attaining of 55 years age) will not be legally eligible or
liable for Provident Fund membership on his employment or
re-employment in a covered establishment albeit when his wage/
salary is less then Rs.6500 per month. If either of the two
conditions are not fulfilled, the employee will be eligible and
liable to be covered from the first day of joining at least on
Rs.6500 per month even when he is drawing more salary.
The term “excluded employees” is a product of the Employees’
Provident Fund Scheme, 1952 as defined in clause (f) of para 2 as
under :
“An employee whose pay at the time he is otherwise entitled
to become a member of the Fund, exceeds six thousand and
five hundred rupees per month.
Explanation : ‘Pay’ includes basic wages with dearness
allowance, retaining allowance (if any) and cash value of food
concessions admissible thereon.”
“An excluded employee employed in or in connection with
the work of a factory or other establishment to which this Scheme
applies shall, on ceasing to be such an employee, be entitled
and required to become a member of the fund from the date he
ceased to be such employee.” [para 26(3) of EPF Scheme]
Persons who are retiring and settling their claim with the
Provident Funds authorities after attaining the age of 55 years
will be ‘excluded employees’. In this context, the word ‘Fund’ is
important. It signifies that only those persons who have settled
their claim with the Provident Fund established by the Employees’
Provident Fund Act/Scheme or any other Fund covered under
1. Kay Iron Works v. Union of India, 2007 LLR 175 (Bom. HC)
Coverage of Employees under Provident Fund Act
Articles Articles
that Act/Scheme will qualify for being termed as ‘excluded
employee’. To be more specific it is pertinent to note that anybody
retiring from an establishment of the Government or an
establishment not covered by the Employees’ Provident Funds
and Miscellaneous Provisions Act, 1952 will not qualify for
exclusion from membership in a covered establishment under
any circumstances whatsoever.
In this regard reference could be made to a judgment of the
Bombay High Court, where the Asstt. Provident Fund
Commissioner for Maharashtra and Goa called upon the
petitioner to remit the provident fund dues in respect of 11
employees who had already retired. Such employees were, in
fact, retired from service on attaining the age of 55 years. The
amounts due towards their provident fund were also received
by them. However, after retirement, these persons were allowed
to work as per their convenience subject to their health conditions.
The petitioner Company challenged the demand raised by the
provident fund authorities in a writ petition and referred to para
2(f) of the Employees’ Provident Funds Scheme defining ‘excluded
employee’ read with clause (a) of paragraph 69 of the Employees’
Provident Funds Scheme (supra). The High Court quashed the
demand as raised by the Provident Fund authorities.2
RETIRED EMPLOYEE IF COVERED ARE NOT
ELIGIBLE FOR EMPLOYEESí PENSION
SCHEME
In view of provisions contained in para 6A of the Employees’
Pension Scheme, 1995 restricting membership of the Pension
Scheme till attaining the age of 58 years or the fact that any
pensioner availing pensionery benefit under the Employees’
Pension Scheme, 1995, will not be required to be enrolled to the
membership of the pension fund (EPS, 1995) (though they will be
enrolled to the membership of the Employees’ Provident Fund
Scheme, 1952 as there is no age bar for the same) there will be no
requirement to divert their share of pension contribution to the
pension fund. Resultantly their entire EPF contribution will
remain credited in their provident fund account only.
From India, New Delhi
Dear Concern
Kindly let me on the below concerns with respect to the PF
1) HAVING A TOTAL OF 20 EMPLOYEES AND ALL HAVE A SALARY MORE THAN 6500, IS IT MANDATORY TO GO FOR PF
2) WHAT IS THE MAXIMUM TEAM SIZE WHICH CAN BE EXCLUDED FROM BEING IN PF BRACKET
3) READ IN A SITE THAT IF ALL THE EMPLOYEES AND EMPLOYERS AGREE NOT TO GO FOR PF, IT CAN BE EXEMPTED
I WOULD ALSO LIKE TO KNOW ABOUT THE ESI
WITH THE POINTS BEING SAME AS FOR THE PF
From India, Kochi
Kindly let me on the below concerns with respect to the PF
1) HAVING A TOTAL OF 20 EMPLOYEES AND ALL HAVE A SALARY MORE THAN 6500, IS IT MANDATORY TO GO FOR PF
2) WHAT IS THE MAXIMUM TEAM SIZE WHICH CAN BE EXCLUDED FROM BEING IN PF BRACKET
3) READ IN A SITE THAT IF ALL THE EMPLOYEES AND EMPLOYERS AGREE NOT TO GO FOR PF, IT CAN BE EXEMPTED
I WOULD ALSO LIKE TO KNOW ABOUT THE ESI
WITH THE POINTS BEING SAME AS FOR THE PF
From India, Kochi
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Compulsory Detailes PF withdrawal Form.xls
HC All - Trainees not covered for PF -2010.pdf